Question

Babita, Kavita and Dinesh were partners in a firm. From 1st April, 2018they decided to share the profits in the ratio of 2 : 3 : 5. On this date the Balance Sheet of the firm showed a balance of < 60,000 in General Reserve and debit balance of < 1,20,000 in Profit and Loss Account. The Goodwill of the firm was valued at < 3,60,000. Pass necessary journal entries for the above transactions in the books of the firm. Also show your workings clearly.​

Answer 1

Explanation:

General Reserve A/c -Dr. 60000

To Babita's Capital A/c 12000

To Kavita's Capital A/c 18000

To Dinesh's Capital A/c 30000

Babita's Capital A/c -Dr. 24000

Kavita's Capital A/c - Dr. 36000

Dinesh's Capital A/c -Dr. 60000

To P&L A/c 120000

Babita's Capital A/c -Dr. 72000

Kavita's Capital A/c -Dr. 108000

Dinesh's Capital A/c -Dr. 180000

To Goodwill A/c 360000